EU set to give trade boost to Montenegro

Date: 25/05/2000

By Simon Taylor

THE Yugoslav Republic of Montenegro will be able to export aluminium to the EU duty-free if a package of trade liberalisation measures drawn up by the European Commission is approved by member states next week.

Under the proposals, the Union would scrap nearly all tariffs and quotas on imports of industrial and farm goods from the Balkans in a bid to boost trade and investment flows with the region. The Commission is also calling for the trade concessions to be extended to Kosovo, even though it is still technically part of Serbia.

The package is part of a plan requested by EU leaders at their March summit in Lisbon to help Balkan countries by boosting trade with the Union.

It would allow 95% of exports from the region to enter the Union duty-free, although some restrictions would remain in place for certain sensitive products such as wine and beef.

Commission officials insist the move would not harm EU producers but would stimulate much-needed investment in the region. "There is no threat to EU industry because exports to the Union are very low, but opening the market should have a positive effect on foreign direct investment," said one.

However, officials predict the plan could get a "rough ride" from EU foreign ministers, with Portugal, France and Italy expected to object to some of the concessions being offered in sectors such as steel, footwear and fisheries.

As part of the scheme, Montenegro would be able to export a fixed amount of aluminium to the Union without paying import duties. But only aluminium from Montenegro's biggest plant in the republic's capital Podgorica would be eligible and there would be safeguards to ensure that only locally produced metal benefits from the concession.

The Yugoslav Republic of Montenegro will be able to export aluminium to the EU duty-free if a package of trade liberalisation measures drawn up by the European Commission is approved by Member States.